examination. yesterday cohen's testimony implicated the former president, donald trump, into this alleged scheme to influence the election. cohen says that trump told him to delay payments to adult film star stormy daniels for as long as he could, amendmenting for after the election. -- aiming for after the election. but when those payments were needed, cohen said he wired $1390,000 from his home ec but bity line of credits to hide those payments from his wife, and they were described as cohen's income after rump's transition to the white house. -- trump's transition to the white house. defense cross-examination could possibly happen today, if and that is going to call into with question cohen's credibility. he's a convicted felon, he's admitted to lying under oath, he served prison time partly for his dealings with stormy daniels. he's built a career off attacking trump, written books, he hosts a podcast. donald trump's son, eric, has

attended court with the former president, and he responded to michael cohen's testimony yesterday. watch. >> this is a guy that's a convicted felon. he lost his haw license. he went down the tubes because he was, you know, defrauding, apparently, financial executions based on taxi cab me call thing ons -- medallions. his whole intent of being personal attorney to the united states was to troy and monetize it for self-serving purposes, he testified that today. >> reporter: now, trump is limited on what he can say about the proceedings because he continues to be the under the judge's gag order. but trump did speak to press yesterday before court. watch here. >> we should be out campaigning now instead of sitting in a very cold courthouse all day long. this is a biden prosecution. it's election interference. at a level that nobody in this country has ever seen before. this is the third -- this is for

third world countries, not for the usa. >> reporter: maria, you mentioned speaker or mike johnson who's expected to attend court today along with trump. we're also preponderating to see vivek ramaswamy here as well -- expecting to see, vivek telling our colleague, eric shawn at fox news, that this is a sham trial that is prettily motivated. court reassumes at 9:30 this morning. maria: lydia, we'll be checking back with you. lee carter, your reaction. >> so when you look at everything that's happening right now, i just, i can't reout rate enough how much people view this and can't believe this is the country that we're living in. this is what's happening right now and where our focus is. when you look at polling, more than 70% of americans believe that the system is rigged. when you talk about how people feel about the country, they think that it's out of control. 64% of democrats, 87% of republicans and 75% of independents say that the country is out of control. and 70% of americans believe

that trump is the one that's going to bring major changes back, and that's what they want to see. think the more this goes on, the more that we with see this, the more it benefits donald trump. but a lot of people aren't seeing it because you're on the other side of the aisle. you see what you want to see, and you -- you're not seeing the rise in what people are seeing right now which is a huge amount of change. maria: wow. cheryl, your thoughts. >> glad that lee brought up the polling, but we mentioned this brand new new york times/sienna poll shows in crucial swing states that it is donald trump. and this is in the middle of this trial and, of course, in the wake of all of the media coverage that the americans have been watching of the other trials and charges against the former president. it's having the opposite effect of what i'm sure these prosecutors want to see happen. they want to bury the former president, and the opposite is happening. he's winning except for in the swing states, or michigan. also, too, that key voting bloc, you know, joe biden is losing

those younger voters, he's losing hispanics, and he's losing those black voters. and so come november without the support of those key demographics, maria, joe biden is in a lot of trouble, and they know it. and i think that's why you're seeing the machinations behind the scenes now in particular, you know, joe biden's going to be coming out today in the rose garden of all places about 12:15 to talk about the economy and jobs. and we're going to have to fact check him because he's made misrepresentations about his time in office. so all of this is the political landscape as we're watching the legal landscape that's playing out in downtown manhattan. maria: yeah. i'm wondering if they have a lead into what the inflation data will say today and tomorrow. >> maybe so. we've asked that question before, and it may be so because all we know from the white house guidance right now is economy and jobs and probably a hit to the chinese ev market. maria: yeah. >> what are you going to say? maria: mike, how do you see it?

>> so, look, this is a part of the biden administration's total destruction of western civilization and our society when are it be, you know, 6-10 million people that have come over the southern border to the botched afghanistan withdrawal we talked about earlier, and now it's the haw pare against his number -- lawfare if against his number one political opponent. and every single one of these trials that that trump is under, the 91 indictments more than al capone, okay? you can trace directly back to the white house. the trial in florida, or the national archives, general counsel was meeting with the white house counsel as early as a april of 2021. nathan wade billed 16 hours, the georgia special prosecutor billed 16 hours for meetings with the white house. and then, of course, a mistrial at the biden justice department, michael coangelo leaves i one with of the most coveted positions for any attorney in

the country to be a line prosecutor in the manhattan d.a.'s office to work on a case that was passed up by the special counsel robert mueller, the federal elections committee, the state of new york and alvin bragg's predecessor, cy vance, only to drum up these charges because donald trump not only i think he will be found guilty a pause this is not a fair place for him to have a trial. you have a judge whose daughter is raising all sorts of money off this trial, completely and totally conflicted. just to keep him off the political trail and to give the talking point that donald trump is a convicted felon of fraud in new york. the problem is, is with all of these once you peel back the on onand you peel back the lay yours -- onion, you can see the emperor has no clothes, and it's having a boomerang effect. not even the most skeptical democrat could have predicted it. maria: yeah, it's true. and that's why you're getting everyone to come out so adamant if about this. we're going to keep a spotlight

on it and today we'll watch that cross-examination. thank you, lee carter, for being here this morning. thank you so much. always incredibly valuable information from you. thank you. we see you soon. we are all hands on deck for the rest of the show on the inflation data. we are just getting started this hour. coming up, my next guest is introducing legislation to prevent illegals from voting in our elections. kansas senator roger marshall is here with that. don't miss it. you're watching "mornings with maria" live on fox fox business. ♪ whenever, wherever, we're meant to be together. ♪ i'll be there and you'll be near -- ♪ and that's the deal, my dear ♪ maria: this week on "mornings with maria," tomorrow the biden administration's latest

inflation report card revealed with the brightest minds on television. thursday, president biden drawing a red line on u.s. support for israel. congressman james comer reacts. and friday he's looking to to poster woman for the far-left from congress, marty dolan will join me. it's all right here on "mornings with maria. mt.s good luck ♪ grace didn't believe in magic. but her daughter was happy to prove her wrong. you were made to dream about it for years. we were made to help you book it in minutes. ♪ ♪ i have type 2 diabetes, but i manage it well ♪ ♪ jardiance! ♪ ♪ it's a little pill with a big story to tell ♪ ♪ i take once-daily jardiance ♪ ♪ at each day's start! ♪

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>> "the new york times" just came out with a poll and shows us leading everywhere by a lot. i think we're probably leading in new jersey. we had a rally, over 1000,000 people this weekend -- 100,000. a lot of the mainstream media didn't want to say how many people, hay didn't want to cover it. maria: former e president trump touting the new polls which put him ahead of biden in pennsylvania, michigan, ads, georgia and nevada, all five states biden won in 2020. the poll finds biden -- trump leading in 18-29-year-old

voters, but karine jean-pierre claims president biden is on the same page as younger e generations. watch this. >> we believe that young americans support, support the president's agenda more broadly, right? in an overwhelming way. when it comes to climate change, that's manager that -- something that he's been very clear about and has been the most progressive president on that particular issue. we want to make sure we have an economy that works for young people, we want to make sure that we listen to young people and hear them out. we want to make sure that we continue to work on some of the issues that we talk about whether it's student debt relie- maria: joining me now is kansas senator roger marshall, a minute of the senate budget, homeland security, agriculture and health committees. what's your reaction to karine jean-pierre there? [laughter] >> well, maria, first of all, the young people i talk to are very frustrated. they're spending $1,000 more each month just to get by, just for their groceries, their event, that up type of thing. they've seen the cost of a new

mortgage double under joe biden as well. the number one concern for young folks is their safe safety and security and the economy. the inflation is killing them. this is the worst economy of my professional lifetime the right now. they're feeling the pinch of it, they're ready for a change. maria: it's amazing to me, it's all politics, and it's quite exhausting to hear over and over again like whatever group it is, oh, the president's aligned with the black community, the president's aligned -- you know, he grew up in puerto rico. all this stuff, and we all know it's just because it's an election year. now she's saying it about young people. >> yeah. so he's doing things -- listen, again, don't listen to what he says, watch what he does. and his actions are killing the economy. increased regulations, those are killing small businesses and hurting young people the most. so that's the number one issue. talk what you want to about a different issues, but the number one concern for young folks and really for everybody, safety and security in the economy. joe biden is on his way with out, november can't get here

soon enough. maria: and you write about this in your new foxnews.com op-ed this morning. you write biden's unvetted migrant parole plan put every community at risk. quote, a crucial tool in biden's mass parole scheme is the customs and border patrol one app, cbp1 app. migrants schedule parole appointments at american airports while they're still in their home countries. then the administration allows illegal aliens to use this mobile app as a valid form of id for boarding domestic flights. senator, you're fighting against migrants using this cbp1 app at reagan airport in washington, d.c.. tell us what's going on. >> right. so congress has the authority to determine who flies in and out of washington d.c. so what we're saying is if these airlines are bowing to biden's plan here, which i think is illegal, hen they shouldn't be able to fly -- hen they shouldn't be able to fly into d.c. more specifically, under joe biden, he has paroled 400,000

people from cuba, from haiti, from anything rag what, from venezuela, that have already been flown into some 40 different cities across cross america right now. there's 1.6 million people on the waiting list, and i can guarantee you these people have not been vetted properly. so we're trying to figure out some way to slow down joe biden and this plan. we're telling the airline ares, if you're using that cbp one app as a valid id, we're saying you can't fly into d.c. i wish i could do m but i don't think that, you know, that's the same thing as a driver's license, a passport. again, these people have not been vetted, 400,000 of them flowing into this country with your taxpayers' dollars. maria: so, i mean, look, we're talking about this a lot lately, you've got a lot of people, senators, representatives in the house, who are trying to come up with ideas to stop illegals from voting in the election. we just showed a flier that the texas congressman august pfluger

brought to us, there's a flier going around near the border or which illegals are picking up, and the flier talks about how, you know, illegals can vote in washington, d.c. for a number of positions like the mayor, like the attorney general. do you have any evidence that illegals are actually voting in our elections? >> well, they are absolutely going to be voting in the washington, d.c. elections in those local elections. they're being recruited to vote. so it's happening. there's three or four states hard going to allow this to happen as well. i saw california, maryland, they're going to allow illegal aliens to vote in their local elections. i just want to make sure your with listeners understand, washington, d.c. has become a war zone. i fear for the safety and life of my workers on capitol hill walking to and fro work. every day -- from work. every day, every week we hear of vandalism, carjackings, violent threats, violent actions against people up here. it's no longer safe. washington, d.c. is not a state,

it's a federal district. the constitution clearly states that congress has the authority to oversee the local governance. that's why we want -- we have legislation that would require people voting in these washington, d.c. local elections to be citizens of the united states, for the sake and the safety of our government and our people visiting us. we need to make sure that washington, d.c. is a safe place. maria: yeah. and we're just look at this flier that is being given to illegals. are youd ready for the 2024 election season, it writes. and it says reminder to vote for president biden when you're in the united states. we need another four years of his tenure to stay open. senator, you've introduced a new bill preventing illegal migrants from voting in d.c. election by requiring proof of citizenship. in order to cast a ballot in a municipal election. a federal court recently dismissed a challenge to the 2022 law which allows noncitizens to vote in washington, as you to just said. texas congressman august pfluger, as i mentioned, was with me just a new minutes

ago -- few minutes ago about illegal migrants participating in our elections. watch. >> the administration of president biden for the last three years have continually torn down the idea of being a citizen, that it's no longer important. we don't want administrators or who are administering our elections to be illegal aliens. we want the gold standard to be citizenship. this flier's basically telling you this is specifically to the washington, d.c. area that if you're a noncitizen, get ready to vote. you can vote in the local elections. it doesn't take a conspiracy if neary to look at this -- theorist to say how with you are preventing them from voting in the presidential election? maria: senator, this is incredible. tell us more about your bill. >> well, listen, i want to make sure your listeners understand, there is federal law right now that requires citizenship to be able to vote in a federal election. so whether it's the president, the senate, your house members, they should have to be citizens. but right now what's happening is this is being circumvented.

by allowing people to register to vote even though they're not citizens, that's going to explode into the federal elections when people -- that person running the polling booth can't delineate the two. is so our bill specific ifically targets washington, d.c. and says if you're not a citizen, you cannot vote in the d.c. election, again, washington, d.c. is a federal district. it's not a state. so, therefore, congress oversees those elections. we need a mayor, we need people electing a mayor who's going to keep washington, d.c. safe, keep congress, the supreme court, those type of people safe as well and allow people to come from home and to petition their congress members. maria: do you think that's why joe biden has an open border? >> no doubt about it. he thinks that these 11 million people that have crossed the border illegally are future voters for the democrat party. i think he's going to be surprised. again, the folk, the number one issue of -- the focus, the number one issue of this election is law and order. joe biden is on the way out.

president trump will be the president of law and order. he's going to secure our borders, have the back of our law enforcement officers. this is the number one defining issue going back to your first segment here. this is why the polls are rising for donald trump, because the people know that donald trump will be the president of law and order. maria: well, maybe, but first he's got to get through these indictments. are you worried about this new york trial? >> so i'm watching it. what this trial is doing is actually emboldening president trump's voters. they are going to get out and vote. no matter if it's raining, if it's snowing, people are going to get out and vote it to support president trump, and i think as they see michael cohen on thered today, this is the star witness for the prosecution, mind you. he's written, what, two books, one of them's disloyal and one of them's revenge. this guy is a known felon, he's been convicted, he's lied to congress, and this is the star witness, and we still haven't seen what is the crime that president trump's ever done? i think that americans are seeing this for what it's worth, and they'll -- i hope that they

have a good outcome here for the trial, but this is emboldening american voters to get out and support president trump or he's going to have a record turnout. what did he have in new jersey this weekend? was it 40,000, 80,000? joe biden couldn't get 40 people to walk across the street to hear him talk. maria: senator, we'll be watching. thanks very much for being here this morning. >> thank you, maria. maria: senator roger marshall. quick break and then the april price price index is about nine minutes away. we've got all hands on deck to bring you the numbers. but first, macro mavens president stephanie pomboy is here with her expectations. that's next. you're watching "mornings with maria" live on fox business. stay with us. ♪ ♪ we aren't caught up in your love affair -- ♪ and we'll never be royals ♪

a slow network is no network for business. that's why more choose comcast business. and now we're introducing ultimate speed for business, our fastest plans yet. we're up to 12 times faster than verizon, at&t, and t-mobile. and existing customers could even get up to triple the speeds at no additional cost. from the company with 99.9% network reliability and advanced cyber security, it's ultimate speed for ultimate business. and it's all from comcast business. maria: take a look at interest rates, the 10-year is pulling back bay practice sitting at 4.48% ahead of the april producer price e index out in about a 5 minutes' time, expectations calling for an increte of .if 3% month over month. the new york federal reserve's

latest survey e finding americans expect high inflation to tick the is -- stick around for longer. joining me now is stephanie pomboy. we've had three hot months of inflation, january, february and march. what are you expecting from the ppi today and the cpi tomorrow? >> well, i guess with more of the same in terms of the ppi. we're clearly seeing a are reacceleration of commodity price pressures along with, you know, higher shipping costs related to a lot of the geopolitical unrest around the world. so i don't think that's going to abate with anytime soon. and the open question is how much of those input costs can be passed along to consumers. we've gotten a whole slew of data just in the haas week that suggests consumers have really hit the wall at this point. you know, we had earnings announcements with commentary, downbeat with commentary on the consumers from mcdonald's, starbucks, tyson just to name a new high -- few high profile

companies. and then last week we got the latest credit card borrowing numbers, and they were essentially zero in the latest month. so there's evidence that consumers have now hit their max in terms of how much they're willing to run up their credit cards to sustain consumption in the face of rising costs of everything. finish so this is really, as you know, maria, a topic e i've been focused on, how much of this increase in input costs will companies be able to pass along to consumers in the absence of the fiscal stimulus, all those cares checks that they were getting, you know, a couple of years ago thatten abled them to absorb a lot of those price if increases. we're now hearing from those aforementioned companies that consumers are saying it's enough, i just can't continue to pay these higher prices, and they're closing their wallets. so this will be a real problem on the earnings front. maria: yeah. and then, of course, we'll e get the cpi tomorrow, and the cpi tomorrow is going to tell us whether or not, in fact, these increases have been passed on.

the expectations there call for an increte of .4% month over month and 3.4% year-over-year. "the wall street journal" writing investors have, quote, renewed optimism for a soft landing from the federal reserve. stephanie, in terms of the consumer price index, how much of an impact will this be for stocks if we see another hot reading? >> well, obviously, it'll be extremely negative for stocks. i mean, pushing out this fed pivot that was supposed to happen in the first quart, then the second quarter, now the third quarter and, you know, in diminishing total magnitude. so it's a problem especially if the earnings side of the story starts to decelerate as well. and so that's really, i think, where i'm focused primarily, is what happens with the earnings picture here. because in the absence of fed-provided liquidity, earnings are really the single support under this market. and, obviously, we've had a

pretty robust earnings season. but when you cut through the details there, some of them are fairly foreboding like the aforementioned companies, you know, mcdonald's, starbucks, tyson, etc. but also within the consumer discretionary earnings numbers, so far this quarter with i think discretionary earnings are up 24%. but if you take9 out amazon, that number falls to 2%. and, you know, i'm not an equity analyst, i'm probably skating on thin ice saying this, but my understanding is that the bulk of amazon's earnings now come from the aws, not from the stuff that i'm ordering and having delivered every day. [laughter] so do they even belong in the consumer discretionary bucket, you know in that's another argument. but, so the point is that we look at these averages as indicative of what's happening in the economy and whether it's the consumer spending in aggregate or consumer

discretionary earnings, it's really misleading because there's a couple of company, a couple of consumers that are doing well and everyone else is struggle. maria: yeah. markets are plummeting now, dow industrials down about 116. the april producer price index cross right now. here's the number, cheryling. >> there's a lot to analyze. month over month number came in a little bit hotter hand expected, up .5%. the estimate from the street we were looking for .3%. now, year-over-year april ppi coming in line, 2.2%, with estimates. but remember, .1% stronger than we had a last month. so, you know, just to give you who some context there. core, that came in hotter than expected, .5%. street was looking for core to come in month over month at .2%. and core year-over-year coming in line with expectations, 2.4%. but that's the same read on that number that we got last month.

so to be clear, this isn't really boding well for, oh, inflation's unsticking. this is still looking pretty sticky. let me get into the report really quickly and tell you what the government is saying. basically, they are saying that it looks like overall it came down to once again services. and that's what we saw last month as well. securities brokerages dealing investment advice, that also coming in showing up in this report as well. also trade, transportation, warehousing, those numbers advancing as well. but again, i know this is not fun to talk about, but portfolio management, they're mentioning this. that was a major factor in the april increase and prices for final demand services. also they say we did see some push-ups in machinery and equipment wholesale, residential real estate services, auto retailing, guest room rental,

truck transportation. so a lot of different moving parts in this report and a lot to go through which i'm going to keep going through. but with, again, this lines up with the story we saw for march pp if i and the numbers reflect that -- ppi. it was more of a services inflationary story than it necessarily was an overall goods story, maria. maria: sure. >> so sure you go. but this wasn't, you know, this -- i always say this is the appetizer, the entree is cpi for next month, and we're e getting cpi tomorrow that the you were just talking about. so, you know, inflation hawks are going to have a lot to chew on with this one this morning. maria: joining me now is pennsylvania congressman and house financial services committee and small business committee member dan meuser, former cbo director and american action forum president doug holtz-eakin and still with us, of course, stephanie pomboy, michael lee and cheryl casone. let me ask you, michael lee, your reaction to this number. and let's not forget initially markets traded way down. we were down 116 on the dow

industrials, we're now down now 39 on the dow, but it is another hot number following three months of hot numbers. >> yeah, look, this is not what you want to hear if you're hoping for rate cuts. another, another beat to the upside, not -- you know, i was reading deutsche bank was expecting us to come in the at .4% month over month. this is a really hot inflation number. we'll see if it leaks over, we'll see how cpi comes in later this week, but you can't be feeling good about that number after this number right here. equity markets taking it in stride, and just as an equity investor seeing these, seeing these numbers come in and seeing the fed is and rate cuts basically expectations fall off a cliff, so we went from six down to three, then maybe two, then maybe one, maybe zero, i still don't think rate hikes are

on the table and we're going to need to get a lot more worse data before that becomes a possibility. so to see stocks hang in theres, just to be a stone's throw from absolute all-time highs, makes you feel good that a there's a lot of oomph behind the equity marketally we're seeing right now. but in terms of where with rates are going, i don't think we're going to see low rear rates anytime soon. maria: uh-huh. well, it doesn't look like that in terms of the reaction if we're talking about four months of hot inflation readings. >> maria -- maria: yeah. >> i might be able to answer this real quick. i'm sorry to interrupt you, but i might be able to answer what the markets are looking at right now. we9 got a revision for march ppi. so the original headline read year over year was 2.1, it got revised downward to 1.8. so it could be the revision, and that could be what the markets are seeing, maria. maria: congressman muser, let me ask you your your thoughts on how to rein in inflation when you've got all of this spending

continuing to happen. i mean, you're talking about the inflation reduction act, the fiscal responsibility act, the forgiveness of student act, chips act, green energy tax credits. is that not the reason that inflation has stayed elevated, because of all of the constant spending coming out of congress and being signed into law by president biden? >> well, by all a means. it was just an announcement two days ago that the biden administration was going to -- pumping nearly $17 billion into pennsylvania, you know, for transportation infrastructures which is fine. but, again, it's an artificial additive to economy. and so it certainly is driving the inflation. look, you know, these numbers aren't even, don't tell tell the full story, right? if we're not really talking about rental incomes, we're not talking about local taxes, we're not talking about the level of interest rates not worked into these numbers. so any business that the has regular lines of credit, which

are most, their inflation rate or ppi is actually much higher. i don't think cpi tomorrow is going to be anything great. this administration, maria, you know this as well as anyone, everybody on this panel knows it's doing everything it can, it seems, to weaken our economy. our economy's on thin ice. if you're on thin ice, you don't keep adding weight to it. and -- because that ice is going to break eventually. and elle just add this, you knou know, the fed, everything jerome powell's doing, unemployment continues to go up as inflation if does as well. we're looking at stagflation. i think their mandate should simply be to fight against bidenomics, because it's failing. maria: doug holtz-eakin, how do you see it? >> this is not a good news number for the fed. you know, as stephanie mentioned, we've had a lot of really weak data recent hi. the jobs report was soft, consumer sentiment was down, the

credit card cut in half over one month. so we've had a whole series of weak reports. the ism services was a really bad number. and now you get this hot inflation. so you've got an economy that looks to be cracking underneath a real inflation problem. they're going to earn their money this month. this is a tough position to be in. maria: and you haven't even mentioned the debt and deficits that are there -- [laughter] in the middle of, and markets haven't really responded to all that debt and deficits, have they? >> not as much as i would have expected, but remember, they're just waiting for the reality to hit because come january 1, 2025, the debt ceiling suspension goes away, and everyone has to come to terms with the fact that we have so much debt relative to gdp and on a rah correctly to get worse. the administration's done nothing to days this. it's making the problem worse ever day, and markets are going to wake up to this reality. maria: we're still getting new information, and i want to come back to you, cheryl, to get the

analysis on that. stephanie, first give us your analysis of this this, if pi number. we've been talking a lot about rent, expectationses are that rent is going to come down. it hasn't yet. >> yeah. well, you're talking about as going forward for the cpi number tomorrow? maria: yeah. but first, give us your assessment of this ppi. >> yeah, yeah, okay. so on the ppi, you know, this is overly simplistic, but if we annualize this number, we're at 6 annual rate for input price inflation. the cpi is running at a 4.8% annual rate so, again, this highlights this brewing margin squeeze that i've been talking about where input costs are now rising faster than the current ability to pass them on. one thing i would note within that university of michigan sentiment survey that we got, one thing that hit a record was the share of consumers who who now believe that inflation will outpace their incomes over the next five years. that hit the highest e level in

the history of the survey. that is not a sign of confidence whatsoever. [laughter] and it probably explains why the assessment of the current situation dropped 10 full points in one month. we've only seen that ever during recessions. we saw it in 1990, we saw it during the great financial crisis and again during covid. so these are ominous harbinger, all, and they suggest to me strongly that companies are going to have quite a challenging time as these input costs continue to go up thanks largely to the energy story in this woke agenda that the administration is pushing. and companies find that consumers just find, look, i can't do this nymph. anymore. maria: cheryl's talking specifically about services, and i guess that's because over covid we were buying lots of stuff, right? on amazon or whatever. and after covid people wanted to go out and do things. services. the demand went up, and that pushed up prices. >> and that's what the

government talked about as the main focus, but i'm so glad that stephanie just mentioned energy. because when i dug further down into this report this morning, ppi, it is the energy story. and the biggest component of the goods inflation side in the ppi report this morning was the energy story, and it was gasoline price. and the jump was 5.4 at the wholesale level. so you can't tell me that those input costs, as stephanie keeps rightly mentioning here, that the input costs going into gas stations across this country is going to be 5.4% then add on the margins heir going to add on at the retail level, that is not good news for the more than consumer. we're going -- we're straight into the summer driving season, maria. we're already in the middle of may. maria: right. >> so gas prices, that's going to take over the headlines, i bet you anything, this summer if we keep seeing these numbers heading higher. and americans are not going to be happy. maria: of course, of course.

and, dan meuser, you're from an energy-rich state, pennsylvania. is this resonating on constituents? >> it's the bad with, maria. -- it's bad, maria. our landowners, for instance, their royalties are way down. the so-called pause on lng is not helpful. the added regular elations surrounding pipeline -- regulations surrounding pipeline development, i mean, it's all a huge drag. it's just, there's nothing pro-growth -- look, i even asked janet yellen in a hearing, does this administration have any pro-growth initiatives besides spending, and her answer was we need to continue investments, making investments in the united states of america. [laughter] maria, we have a tax bill that was passed in the house, miraculously even with the democrats that we've had, it's languishing in the senate. i have people every day, small businesses, saying pass the bonus depreciation. it's critical. maria: yeah. >> pass the r&d tax credit, it's

critical. this administration wants to tax, overregulate, now they're throwing these wild tariffs into it as well. and consumers are in debt. you know as well that the consumers have more debt today than perhaps ever before since it's been recorded, and their savings are at an all-tile low. maria: yeah. >> so the so-called soft landing's looking less likely. maria: we're going to talk about that when we preview the c pick, coming up. michael, what do you see in this ppi report that strikes you most? dow industrials just turned positive, up 5 points, so this market is still digesting the report. >> it's got to to be that revision number because you had a huge spike in the 10-year, and now we've come back to basically unchanged. the market is taking this somewhat in stride. the fed fund futures, we're still at 50-50 odds for a rate cut in september which, to me, is pretty shocking. but then again if you look at it through a political lens, we're

most likely going to get a cut before the election. whether it's warranted or not. so that has held firm. but, you know, very surprised we're not seeing a much larger selloff particularly in fixed income based on the number we just got right now. maria: uh-huh. doug holtz-eakin, how do you see things in terms of the consumer? tomorrow we'll get the consumer price index out and and, of course, walmart earnings coming up. that's coming up soon, on thursday. >> right. maria: and we get the retail sales tomorrow as well. >> well, i'm in the stephanie pomboy camp. i'm concerned about the consume- [laughter] particularly the sort of outside of the luxury categories. you know, people really are stretched, and the data is have shown that for a little while now. this is likely going to lead to another hot cpi number, four in a row, and that puts the fed in a tough position. and it does remind everyone, i hope, that last year everything broke in the way of disinflation if. we got huge easing in energy prices, we had a big

productivity boom. that doesn't happen every year. and as it goes away with, things are going to get tougher, and you're seeing that in this report. the margins are going to get squeezed, earnings are going to get hurt. maria: well, we'll see, because the earnings were pretty good, right, tiffany? are we seeing that mar -- stephanie? are we seeing that margin squeeze with for corporates? >> no. the handful of companies that i mentioned cheerily are seeing it -- cheerily are seeing it -- clearly are seeing it, but we've seen just in the last week or two a huge turn in the quality of the data. >> yep. >> i mean, a very snapshot into this is the citigroup economic surprise index which basically spares us all the task of looking at every single index and figuring out which surprised on the upside or downside. it's a composite that looks at everything. it has declined 60 points, 6-0 points, in three weeks. of it was up +41, it's now down 18.

that is in three weeks' time. so it just underscores what douglas and i have been saying about this on the shift in the data. and i'll give you two crucial examples since we talked about services inflation and this whole that post-covid consumers switched from prioritizing goods consumption to services consumption. if since the beginning of the year, restaurant performance as tracked by the national restaurant association has plunged. it hit the lowest level since covid in january, posted the tiniest little bounce in february and then slumped right back over in march. and then last week we got the latest hotel numbers, rev par in the latest month declined for the first time since february of 2021 is which was when people were reluctant to stay in hotels because of covid. maria: right. >> so these are really, again, sort of ground indicators that we might have reached a point where the consumer 's just saying, look, i can't do this anymore. i've run up my credit card, i've

done buy now, pay later, i have depleatedded my savings, and thd the cost isn't coming down, so we're going to have to cut back on things -- maria: so you're saying, cheryl's talking about the services inflation, you're saying it's not actual volume that we're seeing people go out and spend money in hotels, spend money at restaurants, but it's actually the inflation that's actually taking these numbers up? is that what you're suggest suggesting? >> hallelujah. thank you, maria, exactly. [laughter] and i was going to point out tomorrow, tomorrow's expectations for retail sales, for example, is a gain of .4%. that is exactly equal to the expected gain in the cpi. maria: yeah. >> so you will have zero growth in real retail sales, unit sales, and that will be in keeping with the trend we've seen since april of 2021. real retail sales are are down. they peaked in april of 2021. that's three years ago, folks. maria: yeah. >> real unit sales have gone

nowhere. maria: yeah, so, cheryl -- >> the consumer is not strong. maria: yeah. you have to wonder then, cheryl, how president biden is going to spin this all today. >> yes. maria: he's speaking today on the economy. is he just going to give us the headlines like you gave us earlier, oh, yeah, services is up, or are we -- it's not actual volume, it's actually just inflation like stephanie's saying, or is he going to say, oh, by the way, people are using their credit card, using pay later schemes. >> well, he's not going to say any of that. [laughter] all we know so far from the white house is this is going to be a speech from the rose garden where he's going to talk about how great the economy is, he's going to talk about jobs and also likely mention this move on china and the tariffs which also happened this morning. so that's all a official now, the chinese are reacting to that news. so that'll be a piece of it, you know, on defending this country. but the problem is he's going to do this again, he's going to say, oh, well, you know, inflation is down and spending is down and deficits are down

since i took office a. s but every time we fact check him on, maria, he till comes out and gives the psalm talking points. it is an -- same talking points. it is an election year, and the economy's in trouble. they still have not figured out how to spin a bad economy, and it continues to show in the polls that he is falling and falling and falling especially as we talked about earlier with those goinger voters who are paying d i'm so sorry, kids -- 8 for your starbucks drink. but that's the reality that we're in right now. maria: congressman, what about these tariffs? if are you expecting this to actually materialize? the white house threatening it's going to put tariffs on electric vehicles, on certain components coming from china. he hasn't done anything about all the dumping in china in three and a half years but, of course, we're six months away from an election. do you believe these tariffs will, in fact, material ease on chinese goods? >> listen, or maria, this is the administration that gave $100 billion or so for the

development of chip factories, and yet they want to increase their taxes by 7%. the big difference between what president trump -- when president trump was in office and the type of tariffs he talked about was to make american goods more competitive overseas versus, versus our overseas opponents. what biden's trying to do is as he's making american businesses less competitive, these tariffs are meant to protect america from the weakening that the biden administration has caused. so it's completely different outlooks. trump was looking for rest processty, if not 0% tariffs -- reciprocity. biden's trying to protect gwen the weakened economy that we have. solar panels, again, everything they do has a inverted plan to it, right? if. maria: political can, politics. >> -- increase the costs on 'em. maria: right, okay. well, look, we'll see about

that. michael lee, as an investor we've got a market that is digesting these numbers and going back and forth. what do you want to do in what does this report tell you as far as what's most important as an investor in. >> yeah, look, that the rate-sensitive areas are going to be difficult to informs in -- invest in right now. like, i continue to favor things that are going to happen regardless of the macroeconomic story because it is uncertain. i do not see us falling off a cliff, but to say that this is a gangbusters economy or this is a really healthy economy or somehow the atlanta fed gdp has us tracking at 4.2% growth this quarter -- [laughter] you know, that's not a, that's an objective number. it's just reading data as it comes in. but i don't see that trend holding for the rest of this quarter. back to stephanie's comment earlier, amazon's making all of its money from cloud computing, right? it's not from their consumer business. and so you look at these big tech names, and i think what we

saw last year in the magnificent seven was a validation of a very weak, very poor economy with the concentration of the leadership. i continue to favor these big names that have balance sheets that are healthier than most sovereign nations in the world, okay? they have easy access to capital. they're not sitting on boatloads are of cash. they have businesses that are growing dramatically, double-digit year in, year out and then this a. a.i. trend where you're going to see an upgrade of data centers, you'll see the largest corporate investment in technology in the history of the world. i'd be looking to buy these names on weakness because if the fed does nothing and the economy gets weaker from here, this corporate spending is going to -- in technology will, might tail off somewhat, but the market share to the cloud, to cybersecurity, to artificial intelligence is going to become an ever increasing portion of that pie. so while it's gaining share in the technology world, these

large companies, i don't know that they'll be completely insulated, but almost completely insulated from kind of any economic uncertainty. so that, to me as an investor, presents the best risk-reward. maria: there's still a feeling out there that perhaps we have not felt the true impact of 11 rate hikes. stephanie, you've been predicting we would see bankruptcies increase, that we would see mid-capp companies have a harder time with the highest interest rates after11 rate hikes. have we felt the true full impact of the fed's tightening? >> well, we definitely have seen a surge in bankruptcies. i mean, corporate bankruptcy filings are the highest since the tail end of the global financial crisis, so that's happened, it just hasn't happened at the top level of the pyramid that wall street myopically focuses on which is, you know, the top companies. but when you broaden the lens out, those smaller and mid-sized companies are really struggling.

even within the s&p 500 though, interest expense has doubled in the last 12 months, and the reason why it hasn't been a problem for those companies is that earnings growth has been robust. so again, i come back to earnings and what's the outlook there. but i think wall street has seriously overestimated the capacity of the average corporation, including in the s&p 500, to service this higher cost debt in the face of slower earnings growth. i mean, you and i have talked about these before, maria with, but i'll go through them again because they're just stunning. the top 10 companies in the s&p 500 hold twice as much cash as the bottom 400 combined. i mean, this is a tale of haves and have nots in the corporate space that's just as profound as it is in the consumer space. maria: yeah. >> and as relates to earnings and michael's point, you know, the top 10 companies contributed

33% of earnings growth for the s&p 500. so, again, even as el ares to earnings -- relates to earnings we're talking about just a handful of company and looking at these averages and thinking everyone's a fine. maria: yeah, yeah. >> so i very much continue to expect problems in the corporate credit space around is servicing this higher or cost debt especially since a lot of them just extended and pretended in the hope that we would now have rate cuts by now. maria: yeah. >> and now that they're getting pushed out, their ability to sustain this is really very limited. maria: well, we're getting some wild swings in the stock market. we were down 116 on the dow industrials, now the dow is up 40 points. the nasdaq, s&p 500 flat. let's look at tomorrow, cheryl. what's most important as far as you're concerned? we got the cpi, we've got retail sales and later in the month we've got the walmart quarter. >> walmart on thursday, and that's going to be very interesting because they just announced a lot of layoffs at their corporate headquarters. that is not a good sign for the

world's largest retailer. as far as cpi, that month over month expectations of a gain of .4% and a year-over-year head headline of 3.4%, i'm wondering if that might come in a little bit stronger. i don't think i would have said that 20 minutes ago, but i'm saying it now because of the energy component. i think that energy story in tomorrow's cpi's going to be important. i think we will see a falloff in shelter as you have been told, of course, by your sources as well. and retail sales, that gain of .4%, i'm not going to be so much focused on are retail sales as i am for ppi -- or c or pi, excuse me. and real quick, we're going to get housing starts and building permits on friday. and because of these higher interest rates, we've gone over 7% again for the 30-year fixed mortgage, i have a feeling those are going to be some rougher numbers as well. so, you know, this whole inflation story is spreading out into all of the pieces of the data that we watch. the only thing we haven't seen really fall has been the jobs

numbers. and that data still has been kind of in line, we're still seeing around that 200,000 initial claims numbers each week, and that's kind of average. maria: yeah. >> so that's the only question mark. maria: and that's what the president's going to talk about today, jobs and the fact that the jobs numbers have held up. doug, what's most important to you? >> well, i think you come back to the shelter inflation. that's been the piece that has held up the cpi for a year now. it peaked a year after the cpi as a whole. the last three months have been a bumpy year-over-year average, so it's going the wrong direction. everyone expects it to slow down. it just hasn't. and if it doesn't tomorrow, then you should be very afraid of that number. maria: yeah. i mean, look, congressman, the president has told us what the next potential four years would look like. he he came out with a $7.3 trillion budget for 2025, and in it he included $a 5.5 trillion in new taxes. president trump the other day said he wants to double down on tax cuts.

obviously, this is going to be a major issue, financial policy. in the next four years. >> maria, so true. the most important thing to me is what's going to happen moving forward. this administration is not interested in course correction. i am going to be very interested to see what the president has to say in the rose garden today, just pretend that everything is fine. will they, will i think say we're going to look to improve, but as of right now his plan is to increase spending by 23%, increase taxes by nearly a trillion dollars, continue the assault on domestic energy and and harass the living daylights out of business through more regulations. outside of that, it's a wonderful plan. [laughter] maria? maria: yeah, go ahead. >> i just want to emphasize what the congressman just said. last week the administration imposed $180 billion in regulatory costs. maria: yeah. >> the obama administration averages $100 billion a year. they did it in a week.

the regulatory burden is out of control. maria: yeah. and remember when trump came out with all those stacks of papers with the red tape. cutting red tape is a beautiful thing. that was one with of the tools that he used to actually get growth spiking -- >> yep. maria: -- in the u.s. stephanie, your reaction. enter no, i totally agree. i'm going to be watching biden to see if he checks his watch -- [laughter] that's the main thing today. maria: oh, man. >> don't believe your lying eyes with. [laughter] don't believe your lying eyes. there's no inflation -- maria: all right. let's talk about the impact on the fed. what does the fed do this year, stephanie? >> i think that they're on hold until a wheel falls off, and i anticipate the wheel is going to fall off sometime reasonably soon, and then they will, as it is their standard operating period your, hysterically. panic and rush in and cut rates and expand the balance sheet

again. i do think we will see rate cuts, but they will come after the crisis, not before. maria: so you're saying perhaps we go into a recession, perhaps the economy weakens further. that will be, that will be the trigger for the fed to actually cut rates. >> with if you look at what we've seen in terms of the move in the unemployment rate, we may be in recession already. that .5 increase may not sound like much, or but historically once you move .5, you go up a straight line to up 3 percentage points. so we may have started the recession more. we're just waiting for the nb everything r to announce it. maria: all right. we will leave it there. great conversation, everybody. congressman dan meuser, doug holtz-eakin, stephanie pomboy, mike lee, cheryl casone, thank you so much. 30 minutes away from the opening bell, the dow jones industrial average right now is up better than 30 points. the nasdaq and the s&p are flat. let's hand it over to stuart. "varney & company" picks it up. stu, take it away. stuart: good morning, everyone. this is inflation data week.